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2009 (9) TMI 540 - CESTAT, NEW DELHICenvat Credit- The appellant-company is a manufacturer of unprocessed man made fabrics. They were availing Cenvat credit of duty on inputs like PV and texturised yarn. The Department found that there was mis-match between the goods received and the duty paying documents. On the above mentioned grounds, the original authority demanded duty of Rs. 78,864/- along with interest; he imposed equal amount as penalty under Section 11AC on the appellant company; he also imposed a penalty of Rs. 10,000/- under Rule 13 on the appellant company. He also imposed penalty of Rs. 10,000/- on Shri Anil Baldva, Director of the appellant company. Held that- the goods have been received under kaccha challans. The goods on which credit has been taken has been admittedly received under kaccha challans. The need for issue of goods by the supplier under kaccha challans cannot be appreciated especially when credit was to be taken by the appellants. There is failure on the part of the appellant company in linking the duty paying documents to the goods received. Therefore, the denial of credit and the order for recovery of interest are justified. The appeal by the appellant company is rejected in so far as it relates to demand of duty, order of recovery of interest and imposition of penalty under Section 11AC. Penalty on the appellant company under Rule 13 is set aside. The appeal of Shri Anil Baldva is allowed with consequential relief.
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